Calculation of marketing costs

1
Calculation of marketing costs Institutional
approach

• Farmer
• Transport charges 100x.05 50.00
• Octroi 100x0.25 25.00
• Labor charges 100x0.25 25.00
• Total 100.00

2
Calculation of marketing costs Institutional
approach

• M/s Mool Chand (wholesaler)
• Cost of gunny bags 100x1.00 100.00
• Labor charges 1 100x0.20
  20.00
• Weighing charges 0.25 of 46,000 115.00
• Commission 1.00 of 46,000 460.00
• Market fee 1.00 of 46,000 460.00
• Labor charges 2 100x0.25
  25.00
• Transport charges 100x1.50
  150.00
• Octroi 100x0.25 25.00
• Labor charges 3 100x0.25
  25.00
• Total 1380.00

3
Calculation of marketing costs Institutional
approach

• Daulat Chand (retailer)
• Cost of gunny bags 100x1.00
  100.00
• Commission 1 of 485,000 485.00
• Market fee 1 of 485,000 485.00
• Weighing charges 0.40 of 485,000 194.00
• Labor 100x0.50 50.00
• Total 1314.00

4
Calculation of marketing costs Institutional
approach

• Total marketing cost 10013801314 2794 or
  27.94 per quintal
• Price received by farmer 46,000-100 45,900 or
  459.00 per quintal
• Profit of Mool Chand 485x100-(460x100)-1380
  1120 or 11.20 per quintal
• Profit of Daulat Chand 515x100-(485x100)-1314
  1686 or 16.86 per quintal
• Market margin 11201686 2806 or 28.06 per
  quintal

5
Calculation of marketing costs Institutional
approach

• Price spread 515-459 56 per quintal
• Marketing cost 27.94 per quintal
• Market margin 28.06 per quintal
• Farmers share in consumer rupee 89.12 per cent
• Share of market margin in consumer rupee 5.45
  per cent
• Share of marketing cost in consumer rupee 5.42
  per cent

6
Calculation of marketing costs Functional
approach

• Handling costs 454 (16.25 percent)
• Packaging costs 200 (07.16 percent)
• Transport costs 250 (08.95 percent)
• Other facilitation costs (market fee,
  commission) 1890 (67.64 per cent)
• Total cost 2794